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Exercise by Huge of Call Options granted by past Director and possible Acquisition of Shares ito Specific Authority
HUGE GROUP LIMITED
(Registration number 2006/023587/06)
Share code: HUG ISIN: ZAE000102042
(“Huge” or “the Group” or “the Company”)
EXERCISE BY HUGE OF CALL OPTIONS OVER HUGE ORDINARY
SHARES GRANTED TO HUGE BY A PAST DIRECTOR OF HUGE TELECOM
PROPRIETARY LIMITED AND THE POSSIBLE ACQUISITION OF HUGE
ORDINARY SHARES IN TERMS OF A SPECIFIC AUTHORITY TO BE
PROPOSED TO SHAREHOLDERS
Shareholders are referred to the Annual Reports of Huge
for the year ended 29 February 2012 and 28 February 2013
in which disclosure was made of the acquisition by the
Company of various call options over Huge ordinary
shares, granted by certain past and present directors of
Huge Telecom Proprietary Limited (“Huge Telecom”), a
wholly owned subsidiary company of Huge, to the Company
in terms of individually executed call option agreements
(individually a “Call Option Agreement”).
In terms of a written notice (“the Notice”) by the
Company on 31 July 2012 to Manogaran Pillay, a past
director of Huge Telecom, the Company elected to exercise
its rights (“the Rights”) in terms of the Call Option
Agreement concluded with Pillay (“the Pillay Agreement”).
The Pillay Agreement is subject to a resolutive condition
restricting the exercise by the Company of the Rights
until regulatory approval is obtained.
Huge has been in a long protracted closed period
occasioned as a result of reporting timelines and certain
transactions being considered by the Company and as a
result has not been in a position to obtain regulatory
approval.
On 31 May 2013 the Company exited its latest closed
period.
On 11 July 2013 the Parties agreed to give effect to the
Notice and accordingly, Huge will propose to shareholders
of the Company that they approve, by way of a specific
authority, the acquisition by the Company of 438 928 Huge
ordinary shares (representing 0.44% of the total issued
ordinary share capital of Huge) at a price of 85 cents
per share for a total purchase consideration of
R373 088.80 (“the Acquisition”). The purchase
consideration represents a premium of 40.32% to the 30
day weighted average share price of Huge as at 11 July
2013. It is the intention of the Company to return the
shares to authorised share capital. The Company
currently has 9 706 926 treasury shares.
The Acquisition remains in line with the Company?s stated
strategy of acquiring its own ordinary shares, or
exposure to its own ordinary shares, when it is in the
interests of the Company to do so. The Huge ordinary
shares shall be acquired using the available working
capital resources of the Company.
The unaudited pro forma financial effects have been
prepared and are presented in the table below. The
unaudited pro forma financial effects have been prepared
to illustrate the impact of the Acquisition on the
audited, published financial information of Huge for the
year ended 28 February 2013, had the Acquisition occurred
on 1 March 2012 for purposes of the statement of
comprehensive income and on 28 February 2013 for the
purpose of the statement of financial position.
The unaudited pro forma financial effects set out below
are the responsibility of the directors of the Company
and have been prepared in accordance with International
Financial Reporting Standards and by applying the
accounting policies of Huge. The unaudited pro forma
financial effects have been prepared for illustrative
purposes only and because of their nature may not fairly
present the financial position, changes in equity,
results of operations or cash flows of Huge after the
Acquisition.
Before the After the Percentage
Acquisition Acquisition change
Audited Pro-forma
Basic loss per share (11.01) (11.26) (2.32)%
(cents)
Headline loss per (4.11) (4.36) (6.23)%
share (cents)
Net asset value per 235.03 235.77 0.32%
share (cents)
Net tangible asset (9.66) (10.13) (4.84)%
value per share
(cents)
Total number of 89 255 88 816 (0.49%)
shares in issue
(„000)
Weighted average 89 672 89 233 (0.49)%
number of shares in
issue („000)
NOTES:
1. The “Before the Acquisition” basic and headline loss
per share and the net asset value and net tangible
asset value per share have been extracted without
adjustment from the audited, published results of
Huge for the year ended 28 February 2013.
2. The “After the Acquisition” column assumes:
a. The Acquisition took effect from 1 March 2012 for
the purposes of earnings and headline earnings per
share and took effect from 28 February 2013 for
the purposes of net asset value and net tangible
asset value per share;
b. No adjustment to finance costs paid for the year
under review due to the immaterial impact of any
adjustment and the estimated costs of R250 000
relating to the preparation and distribution of
the circular to shareholders in relation to the
Acquisition. Notional taxation of 28% has been
assumed, where applicable.
c. Payment of the consideration for the Acquisition
of R373 088.80 settled by the delivery of 438 928
Huge ordinary shares, which shares will reduce the
issued share capital of Huge.
A circular to shareholders, including a fairness opinion
from an independent expert, will be prepared and
shareholders will be advised therein of the date of the
general meeting to be held to consider the Acquisition.
Johannesburg
15 July 2013
Designated Advisor
Arcay Moela Sponsors Proprietary Limited
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